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Posted by on Jun 11, 2012 in Bidding Wars, Market Buzz, Market Conditions, Tips, Advice & Links | 12 comments | Print Print

Letter-Writing Is Back

Hat tip to T&W for sending this along, from msn.com:

Just as temperatures are starting to rise, so are multiple offers on prime properties in some recovering markets. To stand out from the pack, an increasing number of buyers are taking the old-fashioned approach and penning a love letter to sellers telling them what they adore about the house and why they are the best suitor to end up with it.

In this digital age, there’s something nice about getting a personal letter written (or even typed out) on paper, even if it comes from someone you are doing business with. That’s why an increasing number of sellers are writing letters to owners when competition for properties gets stiff — especially given that bids considered too high often won’t meet lenders’ appraisal rules.

Anna and Buzz Hays recently wrote a letter to shore up their bid on a midcentury home in a coveted Glendale, Calif., neighborhood. “I thought about it and said, ‘I might not have all cash to pay for the house, but I do have writing ability and I can use that,’” says Anna Hays, a teen-fiction writer.

She described what she liked about the home, including how well-maintained it was, the beautiful rock waterfall by the pool, the friendly neighbors and the “nature and calm” in the wooded neighborhood that surrounded it. She also included a few lines highlighting her and her husband’s résumés and assured the couple selling their home of 15 years that they would take steps to make its pool safe for their school-age twins.

The strategy worked. Hays and her husband beat out the other three offers and recently closed on the property. “They called me when the bid was accepted and said it was because of the letter,” she says.

Is this tactic a good way to set your bid apart from the pack, or is it a waste of time? We asked agents what they thought about buyer letters and what they would include if they wrote one. Most said a sincere letter was worth a shot for a standard sale, not a bank-owned property.

“I have seen them work miracles with sellers, and I have seen sellers put them aside and move on with another offer,” says Ofe Polack, an agent with Coldwell Banker in Manchester, N.H. “Like everything else in life, it takes two to tango.”

However, agents caution that buyers should never go rogue and submit a letter without their agent’s knowledge. “Buyers are never to have direct communication with sellers,” says San Diego agent Kim Drusch of Century 21 Award. She says she often submits photos and background stories of the family she is working with, if she thinks the seller would be swayed by the information.

“A traditional seller typically is devoted to the home they raised their family in,” Drusch says. “They, of course, are vested in who takes over ‘their’ house from this point forward.”

Buyers should convey several things in a letter, including:

  • Specific features or things that they like about the house and the community. “I’ve … had sellers read letters and the compliments made them so happy that they’ve chosen lower offers because of the letter. But not much lower,” says Joseph Moore, an agent with Bridge Realty in Minneapolis.
  • How long they’ve been looking.
  • A little bit about themselves, including names and ages of any kids. “If the buyers knows that the seller raised a family in the house, I would appeal to those emotions,” Polack says.
  • Anything that speaks to their purchasing power or creditworthiness.
  • A commitment to the house and a willingness to do “whatever it takes” to land it.
  • Anything else buyer and seller have in common.

Keep it short and sweet and don’t give so many compliments that the sellers think they’ve underpriced the home, agents say. And don’t expect your prose to bridge a $30,000 gap between your offer and the next bidder’s.

“If you’re sincere,” Hays says. “I don’t see how you can go wrong,”

12 Comments

  1. now that is funny. Seems like we are doing the same thing over.

  2. Okay here is my take on it- All in Fun of course!! :)

    Dear Seller:

    Thank you for considering our offer on your home.
    Our family has been looking for awhile and would love to buy a home in your over hyped school zone as our 3 children desperatly need to go to that school- so that we can tell everyone that our children go to the highest ranked schools in the area.
    We kind of like your home and even though we know the global economy is going to hell and the goverment is playing a rigged game- please find our offer for 50k over list price.
    We know that this property is probably going to lose value slowly over the next 5-10 years as your town is still in a bubble for no justifyable reason.
    But My wife wont get off my back until we buy a home-so I dont really care about it at this point. And at least I get to pay all those mello roos and hoa fees too for your home that looks like most other homes in the subdivision. My friends at the BBQ on the 4th of July will be impressed.

    Sincerly ,
    Joe Buyer

  3. I was actually kidding about buyers writing letters and enclosing pics do toddlers on piggington the other day. This is hilarious and sad all at the same time.

  4. So humiliating.

  5. Dear Deadbeats,

    Get out!

    Signed,
    Everybody

  6. I tried something like this on the last home I put an offer on; but unfortunately it didn’t work in my case. It is getting more competitive in certain areas, seems like we’re are all looking for the same house, with the same attributes in the same price range….yet those homes are scarce. Maybe a letter might work in some cases. I think homes under $ 1 million in nice decent condition “close-in” have multiple buyers at this point in time…

  7. @ Shadash’s comment…

    LMAO!

  8. Shadash – I don’t see how letter writing has anything to do with “deadbeats”. Who is the deadbeat? The buyer or the seller? Or both?

    I guess it’s hard to resist using your favorite word. Get a new whipping boy.

  9. Dear Seller,

    This is the house for us.

    Suzanne researched it.

    Seller, one more thing:

    Kiss My Ass.

  10. Coronadoandre – you described Carmel Valley to a t. Very well written and hilarious!

  11. ““Buyers are never to have direct communication with sellers,” says San Diego agent Kim Drusch.

    WHY? When the broker actually blocks you (either the Seller’s broker or my broker) from talking to the Seller, it feels like they’re actually hurting the deal. Questions have to pass through me->My broker->Sellers Broker->Seller->Sellers Broker->My Broker->ME.

    It takes forever and there’s a ton of opportunity for miscommunication. I always assumed brokers were fearful of losing a commission if they were cut out of the loop, but this game of Telephone gets absurd and childish.

  12. It is one thing to see direct buyer-seller communication going sideways, and know that generally it is a bad thing.

    It’s another to say it in public. It gives the impression that agents can’t handle it.

    Usually it’s not a problem, but a fair amount of the time it leads to hostility. Say it like that.

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